Minnesota franchisor bonds.
From $100.

When the Minnesota Department of Commerce conditions a franchise registration on financial assurance, a franchisor can post a surety bond in lieu of impounding franchise fees under the Franchise Act (Minn. Stat. ch. 80C). The premium is 1% of your bond amount, $100 minimum; enter the amount Commerce set and your exact price appears at the application.

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An alternative to impounding franchise fees when Commerce requires financial assurance under ch. 80C

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Names the State of Minnesota as obligee and backs the franchisor’s obligations under the franchise contract

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Premium is 1% of your bond amount, $100 minimum — enter the amount Commerce set and your exact price appears at the application

1% of amount$100 minimumNo SSNin the applicationInstantissuance for most

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How it works

Three steps. One sitting.

No underwriting queue for the standard franchisor bond — enter your amount, pay, and file with Commerce. Here is the whole thing:

TODAY · ONLINE

Apply online

Your franchisor details, the bond amount Commerce required, and the effective date — that is the entire application.

INSTANTLY

Issued on the spot

No credit fields in the application, and no waiting — the executed bond is generated as soon as you pay. Larger amounts may get a quick underwriting review.

SAME DAY

File with Commerce

Submit the executed bond with your franchise registration as the financial-assurance condition. Wet-ink originals mailed on request.

About this bond

What it is and who needs it.

What the franchisor bond covers

Minnesota regulates franchise offerings through the Department of Commerce under the Minnesota Franchise Act (Minn. Stat. Chapter 80C) and Minnesota Rules chapter 2860. As a condition of registration, Commerce can require financial assurance — typically an impoundment of franchise fees — to protect prospective franchisees.

A franchisor may post a surety bond in lieu of that impoundment. The bond is issued by a corporate surety authorized in Minnesota, names the State of Minnesota as obligee, and is conditioned on the franchisor completing its obligations under the franchise contract — to provide the real estate, improvements, equipment, inventory, training, or other items it promised in the offering.

Commerce sets the amount based on the franchise fees charged and the number of franchises offered. If the franchisor fails to perform, an injured franchisee can recover against the bond — and if the surety pays, the franchisor repays the surety. We issue the amount Commerce set, with pricing from $100 and no credit fields in the application.

Minn. Stat. ch. 80C / Minn. Rule 2860Under the Minnesota Franchise Act (Minnesota Statutes Chapter 80C) and Minnesota Rules chapter 2860, the Department of Commerce may condition a franchise registration on financial assurance. A franchisor may post a surety bond in lieu of impounding franchise fees; the bond is issued by a corporate surety, names the State of Minnesota as obligee, and is conditioned on the franchisor completing its obligations under the franchise contract. Commerce sets the amount — confirm it on your registration.

You need this bond if you are

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A franchisor registering to offer franchises in Minnesota

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Posting a bond in lieu of fee impoundment to satisfy a Commerce financial-assurance condition

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Renewing a franchise registration that carries a financial-assurance requirement

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A franchisor charging significant upfront fees before delivering on the franchise offering

One application, issued on the spot.

Submit the application with the bond amount Commerce set — the executed franchisor bond is generated instantly, ready to file.

Start the application →

FAQ

Common questions.

How much is the Minnesota franchisor bond?The premium is 1% of your bond amount, $100 minimum — set by our carrier’s rate book, not by credit tier. The bond amount itself is set by the Department of Commerce based on the franchise fees you charge and the number of franchises you offer. Enter that figure and your exact price appears at the application.

Why would I post this bond?When Commerce conditions your franchise registration on financial assurance, the default is to impound franchise fees. Posting a surety bond instead lets you keep using those fees in the business — you pay the bond premium rather than locking up the cash.

Is there a credit check?The application collects no credit information, and most applications approve instantly. If a check ever runs, it’s a soft pull only — it never affects your credit score.

Who does the bond protect?Prospective franchisees. It is conditioned on the franchisor completing its obligations under the franchise contract — real estate, equipment, training, and the like. If the franchisor fails to perform, an injured franchisee can recover against the bond.

What amount should I enter?Use the amount the Department of Commerce set for your registration. If you are not sure, send us the Commerce correspondence and we’ll confirm before issuing.

Which A-rated carriers underwrite these bonds?Typically Arch Insurance Company (A.M. Best A+) or Nationwide Mutual Insurance Company (A.M. Best A). Which one writes your bond depends on the bond type and your state. The carrier's name and official signature are printed on the bond you receive.

How do I contact Light RFP about this bond?Email insurance@lightrfp.com. It reaches the bond team at Light RFP Risk Management Services LLC (NY DFS License # PC-1978982). Write to us about quotes, applications, bond forms or certificates. We will respond within 24 hours.

Related bonds

Other Minnesota bonds.

Franchisor bond, issued today.

Pricing from $100. Enter the amount Commerce set and file the same day.

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Your premiumfrom $100

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